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Other existing backers , , and all participated in the latest round, along with new investor .

The investment brings The Zebra’s since its 2012 inception. The Austin-based company last raised $40 million in an Accel-led Series B in September 2017. As part of that funding round, Accel and The Zebra tapped , former president of travel metasearch engine as its new CEO.

“We like to think of The Zebra as the ‘Kayak of Insurance,’” Melnick told me. “We’re basically creating a virtual insurance agency.”

The Zebra started out as a comparison site for people looking for auto insurance. And it’s partners with nine of the 10 top auto insurance carriers in the U.S. Over time, it’s also “naturally” evolved to offer homeowners insurance with the goal of eventually branching out into renters and life insurance.

“Ultimately, as people evolve through their insurance needs, we can be there for them,” said Melnick, who invested in the company’s Series B and C rounds.

Meanwhile, the company says it did not intentionally raise less in its Series C than its Series B but instead aimed to raise just what it needed to keep up with its momentum. (For more on companies that are not trying to grow at all costs, read my story on the increased focus on profitability here.) Also, to read about another company that also took that approach (raising less in its Series C than B), head here.

How it works

The Zebra offers a real-time quote tool that compares more than 100 insurance companies.

Despite being an online company, The Zebra prides itself on offering customer service help via telephone as well in acknowledgement of how “complicated” of a product insurance is.

“If someone gets stuck, we have licensed insurance agents in all 50 states that can talk to them,” he said. “We want to make it as easy and as transparent as possible.” Or, just like a zebra, more “black and white.”

After Melnick joined, The Zebra killed off the lead generation side of its business, going as far as to eliminate any requirements for a user’s phone number to protect the privacy of its users. It also revamped its mobile and desktop platforms. Its headcount has surged from about 50-60 people to close to 200 across its offices in Austin and New York. It also works with a team of developers in Lagos, Nigeria.

“We invested a ton in product management and engineering and became really user-focused,” Melnick said. “We’ve also developed much deeper relationships with carriers.”

The company’s efforts seem to be paying off in the way of growth. The Zebra is that rare transparent startup that actually divulges revenue figures. Last year, Melnick said, the startup saw its revenue surge by nearly 200 percent year over year to nearly $37 million in 2019. The company also says it ended the year with a revenue run rate approaching $60 million, “more than half of which was driven by users coming organically to The Zebra’s website.” Melnick projects revenue to grow “well over” 100 percent in 2020.

The flexibility of The Zebra’s model means it’s “agnostic to a carrier’s business model” Melnick said.

“We can refer people to agencies such as or or we can also work with direct insurance agencies like or insurtech startups such as ,” he added. “We can offer a bigger breadth of product than most places.”

Looking ahead, the startup plans to increase its use of machine learning “to better serve customers and bind more policies in-house.” It also plans to add more customization so it can serve a wider audience.

Investor POV

For Accel Partner John Locke, The Zebra is “the most interesting company in insurtech” and one of the fastest-growing consumer businesses his firm works with globally. Also, Accel believes insurance is one of the most interesting consumer markets in general in tech right now.

“It’s the largest consumer market yet to shift digital,” he said. In fact, he points out that the auto insurance market in the U.S. is expected this year with just an estimated 20.7 percent of insurance being purchased.

“We believe over the next 5 years that will flip to 80/20 digital (versus the other way around), just like all other major consumer markets such as banking and travel,” Locke added.

He believes old-line carriers realize that consumers want to engage online, so will spend more money acquiring customers digitally versus via agents. Locke also believes there’s a “terrific amount of startup energy in the market and very talented entrepreneurs building new, fully digital ‘carriers’ like in auto, in renters and (another Accel company) in life insurance.”

For his part, Silverton Partners’ General Partner Morgan Flager has been impressed with The Zebra’s ability to aggressively scale its business “while maintaining a vibrant culture and identity.”

“They’ve grown revenue and headcount quickly, while maintaining their status as one of Austin’s best places to work because they have stayed true to their values and purpose,” he added.

Note: This story was revised post-publication to change Accel Partners to Accel.

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New York-based Lemonade has now raised a total of during its lifetime. Its last raise was a in late 2017 that valued the company at $620 million. led that round as well.

This latest financing also included participation from Germany’s , , (formerly known as Google Ventures), Israel-based , and . Lemonade said it the new capital to accelerate its U.S. and European expansion, as well as to explore new product lines. The company first announced plans – its first major market outside the U.S. – last November.

Lemonade is licensed as a property and casualty insurance carrier and began offering homeowners and renters’ insurance in New York in late 2016. That offering is now available for most of the U.S. population. The company says it powers its offerings with artificial intelligence and “behavioral economics.” Lemonade claims it’s built a system that “collects 100x more data than traditional carriers,” giving it the ability to generate predictive data that can help improve underwriting and pricing. It operates contrary to traditional insurance models, charging a fixed percentage as a flat fee.

Lemonade also has a social good component. As a , the company annually donates a portion of unclaimed premium dollars to nonprofits. But it also believes in growth. , Lemonade CEO and co-founder, told me via email this morning that his company’s revenue climbed 466 percent to $57.2 million in 2018. The number of homes it insures, meanwhile, grew to 425,000 last year (covering just shy of $50 billion in total insured value) compared to just more than 100,000 at the end of 2017.  And, Lemonade upped the number of states it serves to 21 last year compared to eight in 2017. It’s also seen its headcount climb – to 165 employees today, up from around 50 a year ago. For more details on its growth metrics, check .

Note: We updated this story post-publication with comments from the company.

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